Britain's FTSE rises as easyJet, Smiths Group updates in focus

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* FTSE 100 up 0.5 pct

* easyJet hikes guidance, shares rise

* Smiths Group unit hit by EU regulation

* Brexit worries, inflation data hit pound

LONDON, July 18 (Reuters) - The UK’s top share index marched higher on Wednesday, helped by a weaker pound as company earnings took centre stage with some notable share price moves for easyJet and Smiths Group.

The blue chip FTSE 100 index was up 0.5 percent at 7,662.83 points at 0855 GMT, in line with a broader rally among European stocks as the second quarter earnings season steps into gear.

Shares in easyJet were among the top gainers, up 2.5 percent, after the budget airline upgraded its full-year guidance and said that profit could jump by as much as 45 percent in 2018.

“The stars are aligning for easyJet this year,” Richard Hunter, head of markets at interactive investor, said, highlighting helpful factors such as the demise of some of easyJet’s competitors.

More broadly, miners and health stocks gave the biggest boost to the index. However, updates also prompted some large losses.

At the bottom of the index Smiths Group was down nearly 8 percent after the engineering company said that it expected full-year revenue at its medical unit to drop due to new EU regulation.

Shares in Royal Mail gave up yesterday’s gains with a 6 percent slide as brokers cut their price targets for the company following Tuesday’s trading update.

Elsewhere Brexit developments and inflation data weighed on the pound, which in turn gave the FTSE’s dollar-earning constituents a boost.

Though British Prime Minister Theresa May won a parliamentary vote earlier in the week and kept her Brexit strategy on track, she has had to bow to pressure from Brexit supporters in her party.

However, divisions in the party have become apparent as Brexit rebels were threatened with a general election this summer if they defeated Prime Minister May’s Brexit plans on customs, a lawmaker said on Wednesday.

“The growing lack of trust within the governing party as well as the political splits across the UK parliament are making it increasingly difficult for investors to ascertain a scenario where any agreement, even if one could be reached, would be acceptable to the EU,” Michael Hewson, chief market analyst at CMC Markets UK, said. (Reporting by Kit Rees Editing by Raissa Kasolowsky)